Beware of Midnight Regulations

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.

December 20, 2016 - 10:00 — Curtis Kalin

As President Barack Obama’s term comes to an end, many federal agencies and departments are attempting to beat the clock by jamming a flurry of new regulations onto the books before January 20, 2017.

These “midnight regulations” occur at the end of every presidency, but this time, they follow an exponential expansion of the federal bureaucracy over the past eight years. According to a May 23, 2016 Heritage Foundation study, 20,642 new regulations have been added since President Obama took office in 2009. An August 6, 2016 American Action Forum (AAF) report on major regulations, which are rules that have an economic impact of $100 million or more, found 600 such regulations, “which is 20 percent more than the previous president did in eight years.” That translated to $743 billion in regulatory costs and 194 million paperwork hours.

A midnight regulation is a new rule that is published after Election Day and before Inauguration Day. The AAF predicted that the Obama administration would implement 20 new regulations before the president leaves office, which would cost $44.1 billion.

The allure of bureaucrats to speed up the regulatory sausage-making in a lame-duck period is clear: With a long and bruising election having just ended and the holidays in full swing, regulators see an opening to sneak through controversial measures than would never pass muster under the scrutiny of a full legislative session. This impulse is especially stark when the opposing party is poised to move into the White House. A July 17, 2012 study by the Mercatus Center found that since 1975, there was a 20 percent surge in midnight regulations when a new party takes control of the presidency.

The fundamental problem with midnight regulations is that there is significantly less oversight than with other regulations. A prime example of such a regulation was revealed by Sherzod Abdukadirov and Jerry Ellig of the Mercatus Center: A January 2013 National Highway Traffic Safety Administration (NHTSA) regulation required hybrid and electric cars to “produce a minimum amount of noise to avert accidents with blind or vision-impaired pedestrians and bicyclists.” However, the agency’s rule was based on the faulty assumption that “blind people ride bicycles in traffic in the same large numbers as people who are not visually impaired.” Therefore, the intended impact of this regulation was greatly overstated.

The 2016-17 regulatory Christmas tree is adorned primarily with new Department of Energy and Environmental Protection Agency regulations on gas furnaces, dishwashers, freezers, boilers, ovens, ceiling fans, central air conditioners, and much more. The Department of Transportation is pushing new regulations on vehicle operators, public transportation, and gas pipelines.

Thankfully, House Majority Leader Kevin McCarthy (R-Calif.) sent a letter on November 15, 2016 to the Office of Information and Regulatory Affairs, warning them, “against finalizing pending rules or regulations in the Administration's last days.” Furthermore, on November 17, 2016, the House passed H.R. 5982, the Midnight Rules Relief Act, which would make it easier for Congress to disapprove the administration’s final regulations. The Obama White House has threatened to veto the bill.

A more fundamental solution would be to enact H.R. 427, the Regulations from the Executive in Need of Scrutiny (REINS) Act. This bill would allow Congress to vote on every major regulation with an economic impact of $100 million or more. H.R. 427 passed the House on July 28, 2015, and is awaiting Senate action.

The potential abuse of executive branch regulatory authority underscores the importance of having transparency and accountability when Washington issues edicts that effect every American. Sunlight is, in fact, the best disinfectant, and no regulatory decree should be handed down at the midnight hour.